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The existence and scope of damage caused by the issuance of an unlawful final ruling; the court’s jurisdiction to adjudicate in the above case SK 14/19

On 26 September 2023, the Constitutional Tribunal publicly delivered its ruling issued with regard to the constitutional complaint of a limited liability company under Polish law which pertained to the existence and scope of damage caused by the issuance of an unlawful final ruling and the court’s jurisdiction to adjudicate in the above case.

The Constitutional Tribunal adjudicated that Article 29 in conjunction with Article 17(44) of the Civil Procedure Code of 17 November 1964 – insofar as the norm specifies the court’s jurisdiction to adjudicate on compensation for damage caused by an unlawful final ruling issued by the same court – is consistent with Article 45(1) of the Constitution of the Republic of Poland.

As to the remainder, the Tribunal discontinued the review proceedings.

The ruling was adopted by a majority vote.

There was one dissenting opinion, filed by Judge Krystyna Pawłowicz.

When considering the allegations raised by the complainant, the Tribunal deemed that it was impossible to substantively review the constitutionality of the first of the allegations – i.e. Article 361(2) in conjunction with Article 4171(2) of the Civil Code in conjunction with Article 4241(1) of the Civil Procedure Code, within the meaning indicated in the petitum of the complaint – in the light of the principle of full compensation, declared in Article 77(1) of the Constitution.

The Tribunal noted that it might not substantively review the said allegations since they actually amounted to questioning the interpretation of the challenged provisions arrived at by the competent common court. Therefore, contrary to the complainant’s view, it may not be assumed that the complainant’s way of understanding the challenged provisions – according to which the existence and scope of damage are correlated with the occurrence of the damage no later than at the moment of the issuance of the unlawful final ruling as well as which excludes court fees, lawsuit expenses, and enforcement costs from the notion of ‘damage caused by issuing an unlawful final ruling’ – has been clearly and authoritatively reflected in the jurisprudence of courts. Thus, it could not be concluded that the norms challenged by the complainant might be substantively reviewed by the Tribunal, which in turn necessitated the discontinuation of the review proceedings within that scope. Obviously, the complete reasoning for the Tribunal’s stance in this respect is included in the written statement of reasons.

When assessing the other of the complainant’s allegations, namely the one pertaining to Article 29 in conjunction with Article 17(44) of the Civil Procedure Code – insofar as the challenged norm concerns the court’s exclusive jurisdiction to adjudicate on compensation for the damage caused by the same court’s issuance of an unlawful final ruling. The Tribunal held that the said allegation may be subjected to substantive review in the present review proceedings. The Tribunal did not share the complainant’s view that the challenged provisions infringed Article 45(1) of the Constitution, insofar as it guarantees the right to an impartial court. The Tribunal pointed out that the said impartiality implies that “a judge strives for objectivity, and does not create a more favourable situation for any of the parties to, or the participants in, proceedings, both in the ongoing trial as well as at the adjudication stage. Indeed, the judge treats all participants in the proceedings equally. The said impartiality is not only “the indispensable quality of the judiciary”, but it also constitutes the judge’s individual attribute which is a necessary qualification for exercising the judicial office. What constitutes the essence of the first of those aspects of impartiality, the so-called objective impartiality, is “not only that a judge adjudicating on a case should always act in accordance with the standards of independence and impartiality, but also – when externally evaluated – the judge’s conduct should meet such standards. The rules of excluding a judge from the examination of a particular case are meant to enhance social trust in the administration of justice (…) by eliminating even the appearances of the lack of impartiality.” The other aspect of impartiality, the so-called subjective impartiality, entails that a judge must also additionally have the inner conviction about the possibility of issuing a judgment without favouring any of the participants in given proceedings.

In the light of the Tribunal’s jurisprudence, “the independent court is composed of persons whom the law assigned with the attribute of independence, not only by expressis verbis declaring the existence of that characteristic, but also by shaping the system of determinants affecting judges’ actions so that the said independence could actually and effectively be guaranteed”. Judges are independent when “in the course of administering justice, they are subject to a legal norm and adhere to their own inner conviction”. The said independence comprises the following: (1) impartiality towards participants in proceedings; (2) independence from extrajudicial authorities (institutions); (3) the independence of a judge from court authorities; (4) independence from political factors, especially political parties; (5) the internal independence of a judge.” The said independence also implies prohibition “against not only actual but also illusory dependence of courts (judges) in their judicial activity on factors other than the requirements of law. Independence in its objective aspect is assessed by examining whether objective facts may raise reservations as to the maintenance of independence. What is meant here is the trust reposed in courts by society, and by parties to court proceedings in particular.

The Tribunal stressed that the constitutional standards of the right to a fair trial require the adoption of appropriate statutory solutions, but without overregulating that matter. Partiality constitutes such mental state of a judge which could be manifested externally to a lesser or greater extent. Hence, any threats to impartiality may be objectivised only within a limited scope.” Consequently, “the guarantees of the judge’s impartiality, when it comes to shaping the image of the administration of justice are – as a result – constitutionally admissible: (1) if they are justified by society’s concern as to the moral and ethical standards of judges and other persons assigned with duties within the scope of the administration of justice; (2) if, in the first place, the legislature resorts to such guarantees which make it possible so evaluate the individual conduct of a judge, and do not a priori and, in a way, ‘objectively’ assign the judge with the attribute of partiality; (3) if the legislature primarily resorts to restrictions which do not constitute prohibitions that are absolute in character, i.e. which do not ex lege, automatically trigger irreversible effects, from the point of view of the persons subject to such restrictions.”

The Tribunal noted that legal action against the State Treasury is – pursuant to Article 29 of the Civil Procedure Code – brought in the court which has jurisdiction over the location of the state organisational entity the activity of which is linked with the claim made. Hence, the representative of the respondent in the complainant’s case was the president of the circuit court which was considering the relevant case. This means that the case was considered by judges who were linked, by organisational ties, with one of the parties to the proceedings, i.e. the respondent.

Referring to its previous jurisprudence, the Tribunal held that the substantive-law construct implying the unitary nature of the State Treasury as a legal person leads, in the sphere of procedural provisions, to the effect that the respondent is always the State Treasury, and not particular organisational entities. The requirement to specify the competent state organisational entity at a trial arises from the necessity to identify the relevant jurisdiction of the court, ensure proper representation of the State Treasury, and specify that entity in a ruling for the purposes of the court’s enforcement of the ruling. Therefore, there are no grounds for the assertion that the circumstance that the respondent is the president of the court which is considering a given case always results in an infringement of the right to have a case considered by an independent court. The adjudicating bench of the Constitutional Tribunal held that the acceptance of the assertions put forward in the complaint – concerning a relation between the powers of the president of the court set out in the Act on the Organisational Structure of Common Courts and the content of rulings issued by the judges of a given subordinate court or courts – would entail assuming that, in the Polish legal system, the principle of judicial independence is not actually binding. Indeed, there are no grounds (the complainant did not indicate any either) for restricting the applicability of the said principle only to the situation in which the president of a court is a party to court proceedings as a representative of the State Treasury.

The Tribunal noted that the court has the obligation to implement the provisions requiring the effective recovery of outstanding payments for all eligible persons. The said activity, i.e. exercising judicial powers, has no direct link with the representation of the financial interests of the State Treasury. Although, in the present case, there is organisational oneness between the adjudicating court and the state, and thus also the State Treasury, but there is no functional oneness. The court does not act in the present case in the name of the State Treasury, but it adjudicates on the protection of the rights of a party to the relevant proceedings, as it would act with regard to any other party whose right should be realised in compliance with the provisions in force. The circuit court represents the State Treasury in the functional aspect only within the scope of disputes arising from that court’s activity. Thus, the Constitutional Tribunal dismissed the allegation about the infringement of the court’s impartiality and independence when adjudicating on the complainant’s case.

For the above reasons, and due to the fact that judges are not bound by the ties of organisational subordination as well as due to the position of judges as independent authorities administering justice within the system of common courts, the Constitutional Tribunal did not share the view that the competent court – when determining the complainant’s case – adjudicated on its own case.

The adjudicating bench of the Constitutional Tribunal in the case was composed of: Judge Wojciech Sych – Presiding Judge; Judge Jakub Stelina – Judge Rapporteur; Judge Krystyna Pawłowicz; Judge Stanisław Piotrowicz; Judge Piotr Pszczółkowski.